The housing market is expected to cool off in 2020, according to real estate experts. If you’re a buyer, don’t get too excited yet — that doesn’t mean home prices will start falling nationwide.

“Real estate is on firm ground with little chance of price declines,” said Lawrence Yun, chief economist at the National Association of Realtors, in a press release.

Instead, what the cool-off means is that home prices won’t continue to rise as quickly as before. In 2019, the median sale price for homes in the U.S. rose by 5%. For 2020, home sale prices are forecasted to rise by just 3.6%, according to economists surveyed by the National Association of Realtors. However, some housing markets across the U.S. have already seen a significant slowdown in home price growth, a new GOBankingRates study found. That could be good news for buyers in those areas.

GOBankingRates analyzed the 500 largest housing markets in the U.S. to determine which ones have cooled off the most over the past year. Using data from real estate marketplace Zillow, the study identified housing markets that saw higher growth in median home list prices from 2017 to 2018 compared to the national average. The 136 markets with faster-than-average growth were then narrowed down to the ones that experienced below-average growth between 2018 and 2019. Ranked from the smallest slowdown to the biggest, the final list from GOBankingRates includes the 50 housing markets with the largest drop in year-over-year growth, indicating once-hot markets that have cooled off considerably.

The majority of these housing markets are located in the South and the West — in fact, 10 are in California alone. Unfortunately for buyers, however, you won’t find many of the hottest California real estate markets on this list. If you’re looking to sell or buy a home, proceed with caution: These housing markets could be headed for trouble.

Methodology: GOBankingRates analyzed the 500 largest housing markets in the U.S. according to Zillow. To find formerly hot housing markets, GOBankingRates looked at the change in median list prices from November 2017 to November 2018 and found the markets that saw higher year-over-year growth in 2017-18 compared to the national average. The resulting 136 markets were further narrowed down based on the change in their median list prices between November 2018 and November 2019; GOBankingRates found the markets that witnessed below-average year-over-year growth in 2018-19 compared to the national average. These qualifying markets were then ranked in terms of the difference between the year-over-year home price growth in 2017-18 and 2018-19. The 50 housing markets with the biggest drop in year-over-year growth were included in the final list. For supplemental data, GOBankingRates added foreclosure rates based on November 2019 data from RealtyTrac, as well as the percentage of homes with negative equity, average number of days on the market since October 2019 and percentage of listed homes with price cuts, sourced from Zillow. All median list price data was sourced from Zillow’s November 2019 data. All data used to conduct this study was compiled and verified on Jan. 3, 2020, and is subject to change.

About the Author

Cameron Huddleston is an award-winning journalist with more than 18 years of experience writing about personal finance. Her work has appeared in Kiplinger’s Personal Finance, Business Insider, Chicago Tribune, Fortune, MSN, USA Today and many more print and online publications. She also is the author of Mom and Dad, We Need to Talk: How to Have Essential Conversations With Your Parents About Their Finances.

U.S. News & World Report named her one of the top personal finance experts to follow on Twitter, and AOL Daily Finance named her one of the top 20 personal finance influencers to follow on Twitter. She has appeared on CNBC, CNN, MSNBC and “Fox & Friends” and has been a guest on ABC News Radio, Wall Street Journal Radio, NPR, WTOP in Washington, D.C., KGO in San Francisco and other personal finance radio shows nationwide. She also has been interviewed and quoted as an expert in The New York Times, Chicago Tribune, Forbes, MarketWatch and more.

She has an MA in economic journalism from American University and BA in journalism and Russian studies from Washington & Lee University.

The housing market is expected to cool off in 2020, according to real estate experts. If you’re a buyer, don’t get too excited yet — that doesn’t mean home prices will start falling nationwide.

“Real estate is on firm ground with little chance of price declines,” said Lawrence Yun, chief economist at the National Association of Realtors, in a press release.

Instead, what the cool-off means is that home prices won’t continue to rise as quickly as before. In 2019, the median sale price for homes in the U.S. rose by 5%. For 2020, home sale prices are forecasted to rise by just 3.6%, according to economists surveyed by the National Association of Realtors. However, some housing markets across the U.S. have already seen a significant slowdown in home price growth, a new GOBankingRates study found. That could be good news for buyers in those areas.

GOBankingRates analyzed the 500 largest housing markets in the U.S. to determine which ones have cooled off the most over the past year. Using data from real estate marketplace Zillow, the study identified housing markets that saw higher growth in median home list prices from 2017 to 2018 compared to the national average. The 136 markets with faster-than-average growth were then narrowed down to the ones that experienced below-average growth between 2018 and 2019. Ranked from the smallest slowdown to the biggest, the final list from GOBankingRates includes the 50 housing markets with the largest drop in year-over-year growth, indicating once-hot markets that have cooled off considerably.

The majority of these housing markets are located in the South and the West — in fact, 10 are in California alone. Unfortunately for buyers, however, you won’t find many of the hottest California real estate markets on this list. If you’re looking to sell or buy a home, proceed with caution: These housing markets could be headed for trouble.

Methodology: GOBankingRates analyzed the 500 largest housing markets in the U.S. according to Zillow. To find formerly hot housing markets, GOBankingRates looked at the change in median list prices from November 2017 to November 2018 and found the markets that saw higher year-over-year growth in 2017-18 compared to the national average. The resulting 136 markets were further narrowed down based on the change in their median list prices between November 2018 and November 2019; GOBankingRates found the markets that witnessed below-average year-over-year growth in 2018-19 compared to the national average. These qualifying markets were then ranked in terms of the difference between the year-over-year home price growth in 2017-18 and 2018-19. The 50 housing markets with the biggest drop in year-over-year growth were included in the final list. For supplemental data, GOBankingRates added foreclosure rates based on November 2019 data from RealtyTrac, as well as the percentage of homes with negative equity, average number of days on the market since October 2019 and percentage of listed homes with price cuts, sourced from Zillow. All median list price data was sourced from Zillow’s November 2019 data. All data used to conduct this study was compiled and verified on Jan. 3, 2020, and is subject to change.

About the Author

Cameron Huddleston is an award-winning journalist with more than 18 years of experience writing about personal finance. Her work has appeared in Kiplinger’s Personal Finance, Business Insider, Chicago Tribune, Fortune, MSN, USA Today and many more print and online publications. She also is the author of Mom and Dad, We Need to Talk: How to Have Essential Conversations With Your Parents About Their Finances.

U.S. News & World Report named her one of the top personal finance experts to follow on Twitter, and AOL Daily Finance named her one of the top 20 personal finance influencers to follow on Twitter. She has appeared on CNBC, CNN, MSNBC and “Fox & Friends” and has been a guest on ABC News Radio, Wall Street Journal Radio, NPR, WTOP in Washington, D.C., KGO in San Francisco and other personal finance radio shows nationwide. She also has been interviewed and quoted as an expert in The New York Times, Chicago Tribune, Forbes, MarketWatch and more.

She has an MA in economic journalism from American University and BA in journalism and Russian studies from Washington & Lee University.

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